Interim budget 2014: Fiscal deficit to be contained at 4.6% of GDP

Finance Minister P Chidambaram on Monday said the country's fiscal deficit will be contained at 4.6 per cent of GDP, lower than targeted 4.8 per cent at the beginning of the year.

Mr Chidambaram, however, did not elaborate on how the government achieved its deficit target. He also said that current account deficit for 2013-14 will be at $45 billion.

India's deficit is the highest among the BRIC nations and a breach of the red line at 4.8 per cent of GDP would have led to a downgrade by ratings agencies, which Indian cannot afford at a time when it is growing at the slowest pace in a decade.

Stock markets reacted positively to the fiscal deficit announcement and rebounded from the day's low.